Morris County Sonography Company Settles Kickback Allegations; Enters Deferred Prosecution Agreement and Agrees to Pay $95,000

H&D Sonography LLC of Parsippany, New Jersey, has entered a three-year Deferred Prosecution Agreement (DPA) and will pay $95,000 to the United States, resolving both criminal charges and civil claims related to alleged kickbacks to physicians.

In a significant legal resolution, Morris County-based H&D Sonography LLC has agreed to a deferred prosecution agreement and a $95,000 payment to settle allegations that it engaged in a kickback scheme with physicians to induce referrals for diagnostic testing, announced U.S. Attorney Philip R. Sellinger.

Criminal Resolution:

Who: H&D Sonography LLC, Parsippany, New Jersey.
What: Criminal information filed on August 17, 2023, charging the company with engaging in a scheme to pay inflated rent to physicians for referrals.
When: From January 2015 through December 2018.
Where: District of New Jersey.
Why: To induce physicians to refer patients for diagnostic testing to H&D.
How: H&D paid rent in excess of reasonable value for space in physicians' offices and structured the payments as sublease payments for the shared offices. After payments began, the physicians referred patients to H&D for Medicare-billed tests.

Civil Resolution:

What: Civil settlement of $95,000 to resolve claims under the federal False Claims Act.
Details: H&D knowingly paid remuneration to physicians in the form of inflated space rental payments to induce diagnostic testing.
Whistleblower Provisions: The civil allegations were part of a lawsuit filed by Dr. Richard Chesbrough under the False Claims Act, allowing private parties to sue on behalf of the United States. Chesbrough will receive approximately 17% of the settlement proceeds.

DPA Requirements:

Duration: Three years.
Conditions: H&D must abide by specific measures to avoid conviction.

Investigation and Prosecution:

Criminal Case: Prosecuted by Assistant U.S. Attorney Ray Mateo of the Opioid Abuse Prevention and Enforcement Unit.
Civil Case: Handled by Assistant U.S. Attorney Kruti Dharia of the Opioid Abuse Prevention and Enforcement Unit.
Credits: U.S. Department of Health and Human Services – Office of the Inspector General, under the direction of Acting Special Agent in Charge Naomi Gruchacz, led the investigation.

This resolution sends a clear message to the medical community in Morris County and New Jersey about the legal consequences of engaging in fraudulent practices. It emphasizes the importance of maintaining ethical business practices and upholding the integrity of the healthcare system, especially concerning Medicare. By addressing these allegations, local authorities are working to protect both patients and taxpayers from potential abuse and fraud in the medical sector.